Wall St report: Thursday close
INVESTORS on pins and needles over the three P's - petroleum, Palestine and profits - put aside their worries long enough to end a four-day losing streak on Wall Street.
The Dow Jones Industrial Average, off 115 points on Wednesday, recovered 36.88 points or 0.36% to 10,235.17. The Nasdaq Index, hammered to an 80-point loss in the past two sessions, inched higher by 5.38 points to 1,789.73.
Analysts said indices were lifted slightly by news that Secretary of State Colin Powell would be dispatched to the Middle East and hopes that he return stability to the oil-rich Middle East. 'You saw the averages move up a bit when word came out that Powell was being sent over,' said one trader. 'Anything that removes the threat of higher oil prices is going to be welcomed down here.'
Investors have been worried that oil prices, which have climbed to multi-month highs on the latest conflict between the Israelis and Palestinians, could snuff out an economic recovery and delay a rebound in company profits. Oil prices closed basically unchanged after a sharp run-up in the past few days.
The uncertainty of the pace of recovery and its impact on profits remained central to the day's trading. Phamaceutical company Bristol Myers-Squibb, which numbers headache treatment Excedrin among its products, announced a management shake-up after its chief executive officer said its performance was 'unacceptable.'
Shares in Bristol-Myers, which has lost $60bn. or 50% of its market value since late last year, tumbled $5.55 or 15% to $32.15 after earlier touching $29.16.
Analysts said buying emerged at lower levels in Bristol Myers on rumors that it would attract a bid from overseas, possibly from Novartis or GlaxoSmithKline. Industry analyst Barbara Ryan, of Deutsche Bank Securities, said a deal appeared inevitable because of problems confronting the company. 'Bristol-Myers' days as a standalone company are numbered,' Ryan wrote in a note to clients
Other drug makers fell in sympathy. Merck fell $1.49 or 2.6% to $55.80. Johnson & Johnson dipped 54 cents or 0.8% to $63.48.
A number of analyst downgrades linked to disappointing sales hit the tech sector. CheckPoint Software plunged $5.93 or 20% to $22.07, Compuware dropped $2.82 or 25% to $8.28, Sonicwall fell $2.54 or 25% to $7.54 and Inktomi was marked down 42 cents or 12% to $3.01.
The 'cocooning effect' on consumers in the wake of the 11 September terror attacks was credited with boosting earnings for household goods retailer Bed Bath & Beyond. Its shares jumped $2.08 or 6.7% to $33.67. Scotch tape maker 3M rose $1.21 or 1$ to $114.12 in regular trading, but moved up to $114.12 in extended hours traidng after it said it would post profits above the mid-range of expectations due to cost cutting.
Personal computer maker Dell, which has vowed to pick up market share in the current heated competition, saw its shares rise 56 cents or 2% to $26.75 after it boosted its sales forecast.
